FX.co ★ Palm Oil Extends Gains as Malaysian Markets Reopen

Malaysian palm oil futures climbed nearly 2% to around MYR 4,900 per tonne, extending the previous session’s gains and reaching a one-week high as traders returned from the holiday break. Market sentiment was supported by stronger prices for edible oils on the Dalian and Chicago exchanges, as well as a weaker ringgit. Firmer crude oil prices added further upside amid renewed worries over possible supply disruptions.

At the same time, rising El Niño risks intensified concerns about drier weather and potential production losses across Southeast Asia. Still, the upside was capped by soft export demand and comfortable stock levels. Cargo surveyors estimated that Malaysian palm oil exports for August 1–25 fell by 11.4% to 20% compared with the same period in July, while inventories in July rose to a five-month high, underscoring ongoing supply pressures.

Demand from India may also come under strain, as refiners continue to favour cheaper soyoil. Even so, expectations of strong vegetable oil imports in August are likely to offer some underlying support to the market.